Britain opens doors to Russia on nuclear power

MOSCOW/LONDON (Reuters) - Britain opened the doors to Russia on Thursday to build new nuclear power plants in the UK by signing an agreement with Russian state nuclear firm Rosatom on nuclear cooperation.

Britain has ambitious plans to replace its ageing nuclear power plants by 2025 in a bid to reduce its carbon emissions footprint, but its nuclear new build programme has been dogged by regulatory delays and squabbles about how much public money should be handed to companies for new plants.

Rosatom said it agreed on Thursday to partner with Finnish utility Fortum and Britain's Rolls Royce to seek UK approval to sell its VVER nuclear reactor in Britain with a view to build it at a British site.

"The parties consider the UK energy market to be an attractive opportunity, as most of the operating UK NPP (nuclear power plant) fleet is planned to be decommissioned in the medium term," Rosatom said in a statement.

A senior Rosatom executive told Reuters earlier this year that the Russian nuclear giant was unlikely to apply before 2015 for a licence from British regulators, an expensive process that takes about four years to complete.

"This is the beginning of a very long road, because just the licensing of the project can take up from three to five years and then there is the time it takes to obtain a license for a site," Rosatom spokesman Vladislav Bochkov said. "It is a road map on cooperation with the British energy ministry."

Fortum, which operates the Soviet-built Loviisa reactor in Finland, said the parties would look into how Rosatom's VVER nuclear reactor could be adapted and licensed for the British market, but said it had not made any investment decisions yet.

SIGNS MOU WITH BRITAIN

Britain's nuclear regulator confirmed on Thursday it had not been approached by Rosatom to start a reactor licensing process.

Despite lingering doubts in Europe over Russian technology since the nuclear disaster at Chernobyl in 1986, Rosatom is increasingly bidding for major tenders on the continent.

The memorandum of understanding (MOU) signed by Britain's Energy Minister Michael Fallon and Rosatom Director General Sergey Kirienko in Moscow on Thursday means Russia will be introduced to the regulator details of Britain's nuclear industry, a UK energy ministry spokeswoman said.

"The MOU does not provide access to a site in the UK, nor does it reduce the regulatory or other steps Rosatom like any other company would have to go through if it decided to invest in the UK," she added.

Britain has attracted interest from France's EDF, Japan's Hitachi and a consortium of Spain's Iberdrola and France's GDF Suez to build new nuclear plants, but progress has been slow following Japan's Fukushima disaster in 2011.

While Germany and other countries are turning away from nuclear energy in the wake of the Fukushima disaster, Britain remains determined to build atomic capacity, which now provides about 20 percent of its electricity at nine plants.

The British government is locked into intense negotiations with France's EDF, which plans to build Britain's first new nuclear plants at Hinkley Point, about agreeing on a so-called strike price which will guarantee a minimum price for electricity sold from the new power plant.

A deal was expected to be reached by the end of last year, but negotiations are still ongoing.

Rosatom told Reuters last month it is closely watching to see whether EDF reaches a deal with the British government.

(Additional reporting by Terhi Kinnunen in Helsinki; editing by James Jukwey)